Post navigation

Prev: (01/16/15) | Next: (01/16/15)

Uncle Ike’s first Christmas comes up big but 2015 starts with Washington pot supply (finally) exceeding demand

(Source: WSLCB)

Uncle Ike’s sales outpaced state growth totals on the holiday revenue end of things (Source: WSLCB)

Uncle Ike's first customers were paying $26 for the shop's cheapest gram (Photo: Alex Garland)

Uncle Ike’s first customers were paying $26 per gram for the cheapest strains, now selling for $10. (Photo: Alex Garland)

If you’ve been avoiding Seattle’s retail marijuana shops because of the sky high prices, now might be the time to make a visit . Across the state, retail marijuana prices have dropped by over half in some places from when sales first started last summer.

At Uncle Ike’s, Capitol Hill’s nearest recreational pot retailer at 23rd and Union, some strains are now selling for around $10 per gram. The average gram was selling for $30 when the store opened in September. At the time, the state hadn’t permitted enough growers to meet demand, but the tides have apparently turned.

“Processors are now just sitting on hundreds of pounds and they can’t sell it,” said Ike’s owner Ian Eisenberg. “There are more growers coming on line every day.”

In fact, Eisenberg said the CHS advertiser has so much surplus that he’s having to build out more storage for the glut of pre-packaged pot. Eisenberg filed construction permits for the work last month.

The lower prices may get more customers in the door, but Eisenberg said he and other I-502 retailers still can’t compete with the less regulated and less taxed medical market. This week, City Attorney Pete Holmes issued a call to state lawmakers to fold the medical system in the I-502 framework, a proposal Eisenberg said he supports.

Still, Uncle Ike’s remains one of the most successful shops in the state. State sales jumped 5% on average between November and December, while sales at Uncle Ike’s jumped 23%. Eisenberg’s shop was responsible for 4.15% of total marijuana sales in the state in December with just over $700,000 in pre-tax sales.

An ongoing lawsuit from a neighboring church isn’t slowing Ike’s down, either. In December, a King County Superior Court judge denied Mount Calvary Christian Center’s attempt to shut down Ike’s while their lawsuit against the business moves through court. The church is suing the pot shop for operating too close to a facility it says it being used as a teen center.

Meanwhile, a shuttered pot delivery service that operated on Capitol Hill is getting a new life in the legal market. Last month, the state liquor board approved the Winterlife Coop to become a marijuana processor at a north Seattle facility. Winterlife’s plans include producing “solvent-less” concentrates for vaporizers using alcohol rather than petroleum.

“Our main focus is edibles and concentrates as we believe that more and more the customer base will move away from smoking as the primary delivery source,” Winterlife’s Evan Cox told CHS. “It’s quite a change, but we’ve been preparing for it for some time and we’re overjoyed.”

And one last note: The timeline for an I-502 store opening on 15th Ave E is getting moved back again. Samuel Burke told CHS he now hopes to open tōk sometime in May.

Subscribe and support CHS Contributors -- $1/$5/$10 per month

30 Comments
Inline Feedbacks
View all comments
Bob Knudson
Bob Knudson
5 years ago

Ike says he “can’t compete” with the medical marijuana dispensaries? It seems to me he’s competing just fine if he’s collecting $700,000 a month in sales. He will soon be a very rich man.

Still, I agree with him that the medical marijuana system, where there are serious problems, should be rolled into the legal, retail system.

CaphillTom
CaphillTom
5 years ago
Reply to  Bob Knudson

I don’t. I’ve had medical grade marijuana and its quality far exceeded anything he’s selling. You both are very guilty of making generalizations about the entire medical industry based on your erroneous perception of a few bad eggs who were at Hemp Fest a few years ago.

I GET that he’s running a business and needs customers to survive, but his entire attitude and tossing around of inaccurate “facts” in a recent thread here on the blog completely turns me off to him and his plight.

Ike
Ike
5 years ago
Reply to  CaphillTom

“Medical grade pot” is a myth. Pot sold in dispensaries and via delivery services is in no way medical grade. At least when I think of medical grade anything I envision something made in a sterile, controlled environment and tested for purity and safety. This just isn’t the case. Dispensary pot is grown in collective gardens or shipped in from out of state. There is absolutely zero overseen traceability and testing of the product. Adult use pot is grown in a controlled environment and tested. The use of the term “medical grade” makes people think of a higher standard, when in practice in Washington state it results in the exact opposite.

puffpuffpass
5 years ago
Reply to  Ike

Whether you call it medical grade or some other term, you can tell the quality of the dispensary stuff is better when you look at it, smell it, and consume it. That’s how you test pot.

COMTE
COMTE
5 years ago
Reply to  puffpuffpass

Seems rather subjective to me – it would be very interesting if someone could actually do the same sort of objective analysis of dispensary cannabis as is currently being done for recreational strains; that would certainly be telling.

Ike
Ike
5 years ago
Reply to  puffpuffpass

Comte – I agree with you. Testing is needed to determine if I am full of it or not. Since it is technically an illegal market no health department has been charged with this exercise.

Puffpuff – Look, smell and taste are all important but to ensure public safety all recreational weed is tested for microbials like bacteria, yeast, mold, ecoli, salmonella etc. We buy chicken at Safeway and it might look and taste fine but most of us feel a little safer hoping someone is inspecting it.

Bob Knudson
Bob Knudson
5 years ago
Reply to  CaphillTom

CaphillTom….Those of us who have expressed the view that MMJ dispensaries should be rolled into the retail system are hardly a small minority. There is widespread belief that the dispensaries have serious problems….which you seem to be blissfully unaware of…including those with experienced knowledge of the problems…such as Pete Holmes and members of the Washington State Legislature, who will be acting on their concerns in this session.

Why are you so opposed to this? You’ll still be able to get your medical marijuana at the retail stores, and probably at a price you’re paying now (because it will be tax-free). If you are a legitimate medical marijuana patient, you have nothing to worry about.

Ike
Ike
5 years ago

Bob, We are designed to do multiple times those figures. The way the tax system is in place I suspect most adult use shops are losing money when the bell tolls. Some of these issues will likely be addressed next legislative session but until the illegal market is fixed the demand is just not there.

Bob Knudson
Bob Knudson
5 years ago
Reply to  Ike

Thanks, Ike. But you’re not saying you are losing ,money so far, are you? I realize the $700,000 December figure is for gross sales, including taxes, so your profit (after deducting the taxes and other business expenses) would be much less. Still, I would imagine that you personally are doing pretty well (which I don’t begrudge). Correct me if I’m wrong.

Ike
Ike
5 years ago
Reply to  Bob Knudson

Bob – yea you are wrong. It would be foolish to think many 3 month old businesses are profitable. The problem with your analysis is the deductions. We can’t deduct expenses from gross income for taxes. Taxed on gross. Google IRS 280E and it will make sense. The business has made a little money but we are forced to pay fed tax on a make believe number so overall the venture is losing money at the end of the day. Ike’s is around for the long haul so it is understood it might not make money for first few years. Sorry if this analysis is confusing.

lol
lol
5 years ago

If they want to be making “solventless” extracts they should try not using a ethanol, a frickin SOLVENT.
Solventless extracts refer to dry sift or water collected trichomes, ones extracted without solvents go figure.

And of course Ikes, a retail recreational store wants medical dispensaries folded into the program. They are competition. Recreation store owners should keep their noses out of the medical situation and stop neutering what is already a thinning program for people in actual need.

COMTE
COMTE
5 years ago
Reply to  lol

So, Ike now calls the shots for the City, the Legislature, & WSL&CCB? I didn’t realize he had that much power.

CaphillTom
CaphillTom
5 years ago
Reply to  COMTE

Ike needs to remember a couple things and pronto:

1. the medical dispensaries are selling a superior product to the retailers. They are NOT illegal nor unregulated. They provide a legitimate service.

2. His business is new and it’s never wise to shit in your own back yard. There’s an ongoing legal dispute with people who claim to be a church and teen center very near that shop who will take any piece of info and do anything they can to shut the shop down. DON’T draw excess attention to yourself.

Robert
Robert
5 years ago
Reply to  CaphillTom

Ike, let me step up for a second, and please make any necessary corrections.

How do you define “superior”? Do you mean the THC levels? The accuracy of such levels? I’m sorry, but you really need to take a step back and look at this whole thing critically, this whole notion that medical and legal recreational marijuana are somehow different. Have you verified this with comprehensive tests? And like I said before, do you have a strict, scientific definition of “superior”?

I’ve talked to legal growers, and I’m astounded by the number of legal hurdles they must adhere to, from tracking every single plant to giving accurate THC levels on each package. And think about it. We’re going through a radical social experiment here. Despite the festive label of “recreational”, growers and retailers are EXTREMELY motivated to do the right thing and not screw around with WA regulations. One slip up, and your whole business is shut down.

If a pot shop is selling ditch weed or what have you, the Market will punish them, not to mention the WA authorities. I’m sorry, but this whole “medical is superior to recreational” simply doesn’t hold water.

Ike
Ike
5 years ago
Reply to  Robert

Robert – Nothing to correct. You got it!

Ike
Ike
5 years ago
Reply to  CaphillTom

CaphillTom – All weed is illegal according to the feds. In Washington State medical mj is illegal. As a result this it is also unregulated. Who do you think has authority to regulate it. It really is undisputed except for some anonymous keyboard warriors such as yourself. Pete Holmes did an excellent job outlining it. https://www.scribd.com/doc/251769553/Seattle-City-Attorney-Pete-Holmes-marijuana-memo

CaphillTom
CaphillTom
5 years ago
Reply to  Ike

DUDE, by virtue or the same initiative process that put YOU in business, medical marijuana IS LEGAL in this state. You don’t seem to get that. Failing to add additional regulations to the medical industry does NOT make it illegal.

Pete Holmes is a pot head just you and me and he’s trying to dictate policy for the entire state. Until such a time as he’s elected to a position in Olympia, or he heads WSLCB, he does NOT do that.

Again, I tell you STOP shitting in your own back yard. You’re starting to look like a bully who’s mad because his get-rich quick scheme of selling marijuana to the people of Seattle isn’t making as much as he thought it would.

Ike
Ike
5 years ago
Reply to  CaphillTom

DUDE – No one thought they were going to get rich quick. The guys making the big bucks, tax free, are the mmj folks. MMJ is an affirmative defense, it is not legal. Gregoire vetoed it, so there never was a registry that was part of the initiative. Try reading Pete Holme’s memo. He spells it out pretty clearly.

CaphillTom
CaphillTom
5 years ago
Reply to  Ike

you’re grasping.

All you’re doing is proving that 502 was poorly written and that’s probably something we already agreed on.

HighAboveSeattle.com
5 years ago
Reply to  CaphillTom

“1. the medical dispensaries are selling a superior product to the retailers. They are NOT illegal nor unregulated. They provide a legitimate service.”

1. commercial medical marijuana is not legal according to this article: http://blogs.seattletimes.com/pot/2015/01/05/city-attorney-pete-holmes-offers-his-path-forward-for-pot-policy/

2. If a strain of medical marijuana was tested and mold was found would you still consider this a superior product to the retailers?

esdahman
esdahman
5 years ago

The only thing “IKES” has is more analytical data. Mmj was excepted by the state legislature, it is legal in Wa. And is not fedraly legal. Sound familier Ike? You are in the same boat as mmj so take your shit poor weed education that you pulled off the internet in the last 2 years and go clean some toilets bc you know shit about weed, extracts, and consentrates! You know as much as YOU think you need to know to pass off your bunk shit thats only good for hipsters and moder yippies! So stfu and listen to people who would teach you if you werent such a duche! The only reason you want the two rolled together is bc it will be YOUR wallet that fatens when truly expeirenced people are ran out of buissness! What I suggest is that rec. Stores surrender. there permits to legitimate medical dispensary’s! Passing out highly active medicine should not be left to people completley motivated by cash money who could care less about your pain and sickness to actually give or recomend what you NEED!!!!

COMTE
COMTE
5 years ago
Reply to  esdahman

Dude, step away from the bong!

MMJ is NOT legal in WA. The 2011 bill that would have legalized it also included a provision that all patients possessing cannabis or who participated in a collective-grow operation would be required to be registered with the State. Gov. Gregoire line-item vetoed the registry requirement. Thus, as the law currently stands, those who possess cannabis for medical purposes can still be arrested, charged and tried for possession; however, they may cite the law as an “affirmative defense” in the event of a criminal prosecution. Furthermore, this was upheld by the WA State Court of Appeals last March, which essentially agreed that the law, as written, makes collective-grow and dispensary operations ILLEGAL, hence the recent decision by the City of Kent to outlaw them within their city limits.

As for who’s trying to use the issue to make $$, just tell me please – and try to keep a straight face while you do – how many people currently walking around with Green Cards have an actual, legitimate and medically-recognized condition authorizing them to possess cannabis, or who simply went to some quack, put a couple hundred bucks down on the table and described a vague, un-diagnosed “anxiety disorder” or “muscle ailment” and got rubber-stamped by someone with no credentials? Also, how much in state tax do MMJ dispensaries pay? What about their distributors? Their growers? So, just exactly who has the FATTEST wallet in this scenario: the legal recreational purveyor who has to follow stringent operational and quality-control regulations AND pay taxes, or the unlicensed MMJ “dispensary” who doesn’t have to show you jack about the content of their products, who doesn’t have to follow any sort of quality-control regimen, who doesn’t pay taxes, and is in fact operating in direct violation of state and federal law?

Ike
Ike
5 years ago
Reply to  COMTE

COMTE- Very well said!

esdahman
esdahman
5 years ago

No it would be discarded and destroyed! What kind of dumb ass q. is that. J.h.C.! What would rec. Facility do if they tested and found mold would it be superior?? F’n think before you internet!

COMTE
COMTE
5 years ago
Reply to  CaphillTom

I don’t see how you can make a valid claim that MMJ dispensaries sell a “superior product” without any sort of empirical evidence to back it up. And according to the WA State Dept. Of Health, dispensaries are not “legal”, nor have they ever been – Washington’s current MMJ law allows for patients & dispensaries to offer “affirmative defense” in the event of prosecution, which can be taken into consideration by a judge or jury, but this does not, in and of itself, constitute “legal standing” and one can still be prosecuted for possession & distribution. Just because the law isn’t aggressively enforced doesn’t mean it’s not on the books and can’t be used against a defendant.

And dispensaries are most certainly are NOT regulated, for the simple fact they are, despite your protestations to the contrary, illegal under current law. What IS legal are “collective gardens” own, managed and operated by a group of no more than 10 individuals; most dispensaries don’t even come close to meeting the criteria set forth under RCW 69.51A, and only stay in business because of lax enforcement, NOT because they’re “legal”. This is why I imagine people like Ike and other recreational retailers are pushing – in order to level the playing field.

As for the churchies next door, well, they don’t have a leg to stand on – and I’m sure there are quite a few neighbors who live in the vicinity of their so-called “teen center” who would be willing to testify to the fact that it hasn’t seen anything even remotely like significant activity in nearly a decade. So, again, I don’t think Ike has too much to worry about on that point.

As for

Look on the bright side
Look on the bright side
5 years ago

Washington’s commercial marijuana business has turned into one of the most successful carbon capture and storage programs in the world.

trackback

[…] with the denial, the redevelopment of 23rd and Union is moving forward at an increasing pace. With the I-502 marijuana “campus” of Uncle Ike’s filling the northeast corner of the intersection and one six-story apartment […]

James Baines
5 years ago

700,000 a month while medical marijuana dispensary owners are facing felony charges for growing. http://boycotti502.com

COMTE
COMTE
5 years ago
Reply to  James Baines

All the more reason for MMJ dispensaries to support a system that allows them to operate LEGALLY and pay their fair share of taxes.

trackback

[…] If Uncle Ike’s is any indication, revenues from two more I-502 shops would create a veritable retail marijuana industry in the Central Area. Eisenberg’s shop was responsible for 4.15% of total marijuana sales in the state in December with just over $700,000 in pre-tax sales. […]